The bill is the Senate counterpart to H.R. 1004, which was introduced with bipartisan support in March by Reps. Charles Boustany, R-La., and John Larson, D-Conn.

The Internal Revenue Service created the use-it-or-lose-it rule to keep taxpayers from using FSAs as tax shelters, but that reason is no longer relevant, Cardin and Enzi say.

"With the enactment of the Patient Protection and Affordable Care Act in 2010, annual contributions to FSAs will be capped at $2,500 beginning in 2013, which makes the use-it-or-lose it' rule unnecessary," Cardin says in a statement. "It is both fair and sound health policy to allow FSA participates to cash out remaining funds at the end of the plan year rather than forfeiting the balance to their employer."